Edmund Tie has launched the collective sale of United House, a freehold commercial building located at 20 Kramat Lane just off Orchard Road. The reserve price for the sale is set at $166 million and the collective sale is being managed by Edmund Tie.
This is the fourth attempt at a collective sale for United House, with the previous three failing to meet the requirement of 80% owners’ consent in both strata area and share value, according to Edmund Tie.
The site covers an area of 12,838 sq ft and has a plot ratio of 4.9, with commercial use being allowed under the Master Plan. Edmund Tie estimates that the site could be redeveloped into a 10-storey commercial building with a gross floor area (GFA) of up to 62,900 sq ft.
This translates to a land rate of $3,025 psf per plot ratio (ppr) if the site is redeveloped into a new commercial project.
“United House is not affected by the recent restrictions on the strata subdivision of commercial space. The successful buyer will have the option to consider strata subdivision for the new development,” says Swee Shou Fern, head of investment advisory at Edmund Tie.
Investing in a Singapore condo offers numerous advantages, one of which is the potential to utilize the property’s value for further investments. This means that investors can use their condo as collateral to secure additional financing for new investments, enabling them to expand their real estate portfolio. While this strategy can lead to increased returns, it also carries certain risks. It is therefore essential to have a solid financial plan in place and carefully consider the potential impact of market fluctuations.
Edmund Tie also reveals that a planning application has been submitted to URA to change the land zoning of the site to allow for hotel use, with a plot ratio of 4.9. If this application is approved and the site is redeveloped into a hotel, the land rate would increase to $3,318 psf ppr.
“The prime location of the site along the Orchard Road shopping belt makes it an ideal location for a hotel development,” Swee adds. “With the ongoing enhancements to Orchard Road and the redevelopment potential of United House, we expect to see significant capital appreciation in the future.”
The adjacent Concorde Hotel & Shopping Centre is also currently attempting a collective sale. The 99,623 sq ft plot is owned by Mainboard-listed Hotel Properties and is being priced at $820 million, which includes bonus GFA from balconies and a lease top-up premium of $213.1 million. This sets the land rate at $1,801 psf ppr.
Other buildings in the surrounding area are also undergoing redevelopment or asset enhancement initiatives, such as The Cathay and Faber House, which is being redeveloped into a 250-key hotel.
United House is located within walking distance of Somerset MRT Station and Dhoby Ghaut Interchange, providing access to the North-South, North East and Circle Lines.
The collective sale tender for United House will close on November 14th.